All Entries Tagged With: "IPPS"
CMS abandons IPPS payment reduction for now
Though many hospitals feared a 1.9% reduction in payment for 2010, they will actually see a 2.1% increase, according to the fiscal year (FY) 2010 IPPS final rule that CMS released July 31. CMS had originally proposed a documentation and coding adjustment to account for the effect of increases in aggregate payments due to changes in hospital coding practices that it says do not reflect increases in patients’ severity of illness.
The proposed adjustment would have resulted in historically low payments for hospitals and especially penalize hospitals that have yet to develop a clinical documentation improvement (CDI) program, says DeAnne Bloomquist, RHIT, CCS, president and chief consultant for Mid-Continent Coding, Inc. in Overland Park, KS. “I think that means that hospitals can breathe a sigh of relief.”
In the proposed IPPS rule, CMS intended to reduce future payment rates “based on the observed increase in spending due to documentation and coding that occurred in fiscal 2008,” according to CMS’ press release. However, because it does not have a full year of data that would show the extent of documentation and coding effects on 2009, CMS decided not to implement the adjustment until it has a full year of FY 2009 data.
In the next year, hospitals with CDI programs should continue their initiatives, while those who have not implemented one yet should work toward that goal, says Gloryanne Bryant, RHIA, CCS, CCDS, Regional Managing HIM Director at Kaiser Foundation Health Plan Inc & Hospitals.
CDI implications included in IPPS proposed rule
The long-awaited fiscal year (FY) 2010 Inpatient Prospective Payment System (IPPS) proposed rule is out, and with it comes good and bad news for hospitals. Hospitals will see historically low payment updates with a phased-in documentation and coding adjustment (DCA) to take place over time.
The proposed update for acute care hospitals means an update of 2.1% for inflation minus a DCA of 1.9 percentage points. Long-term care hospitals will see a proposed update of 2.4% for inflation minus a DCA of 1.8 percentage points. These DCA adjustments reflect the differences between the changes in documentation and coding that do not reflect real changes in case-mix for discharges occurring during FY 2008, according to CMS.
These low rates won’t help hospitals struggling to keep their doors open in the midst of a worsening economy. “Hospitals that are counting on some sort of increase won’t really see anything this year,” says Kimberly Hoy, JD, CPC, director of Medicare compliance for HCPro, Inc. in Marblehead, MA. “Payments are going to stay flat, and that’s going to be tough for a lot of hospitals.”
Clinical documentation improvement programs as well as more diligent efforts by HIM are most likely the reasons behind more accurate coding that led to higher payments, agrees Shannon McCall, RHIA, CCS, CCS-P, CPC-I, director of HIM and coding for HCPro, Inc. in Marblehead, MA.
“CMS may have underestimated that facilities would create such effective clinical documentation improvement programs,” she says. “I think those programs were an integral part of all of this.”
And in light of decreased payment updates, hospitals that don’t currently have a clinical documentation program will need to think seriously about implementing one, says Gloryanne Bryant, RHIA, CCS, CHW senior director of corporate coding and HIM compliance in San Francisco.
“Hospitals will need to assess their current efforts to capture patient severity and acuity through documentation and coding to see if opportunities remain,” she says.
CMS cheat sheet on IPPS basics available
Page three and four of CMS’ revised Acute Inpatient Prospective Payment System Fact Sheet (January 2009) contains a number of pastel looking charts outlining what seems to be mathematical equations. These graphical details show how IPPS payments are derived through a series of adjustments applied to separate operating and capital base payment rates.
Although I don’t recommend it for bedtime reading, the Medicare Learning Network Payment System Fact Sheet should be on your CDI required reading list.
Maybe you’ve read it before, maybe you’re already well-versed in the IPPS process and know all about how DRGs became MS-DRGs and how the wage-index fits into the final cost analysis, but maybe all this sounds like you need an accounting degree or a master’s in business healthcare administration. Either way, it’s always good to keep an eye on what CMS says about its own systems.
Maybe make it your lunch-time reading instead.